Over 40 percent of EPL claims are against firms with fewer than 100 employees.

Three of five employers are sued by former employees every year.

The financial ramifications of not having EPL insurance can be crippling, especially for small firms because they do not have the operating budgets to handle the defense costs, let alone settlements or judgments, of an uninsured claim.

The median compensatory award to plaintiffs is $325,000.

Employment Practices Liability (EPL) covers not only ACTUAL, but also ALLEGED acts of discrimination, harassment, retaliation, wrongful termination and other similar acts.

*Indicates class is not eligible for Third Party coverage. Other classes of business are eligible for quote consideration. An application may be submitted. As always, we appreciate your business! Please let us know if you have any questions!

ERISA, which stands for the Employee Retirement Income Security Act, is a federal law regulating employer-sponsored group benefits. Nearly every employer, regardless of their size, is subject to ERISA if they offer even one employer-provided group benefit such as health, dental, vision, accidental death & dismemberment, disability, or group term life insurance; medical flexible spending account or health reimbursement account; wellness and employee assistance program; or any other benefit for which the employer contributes to the cost. The only exempt employers are churches and government entities. Besides requiring certain plan features, the law also mandates detailed reporting requirements, both to the Department of Labor and other government agencies and to employees and covered members under your policies. While ERISA was first enacted in 1974, recent changes under the Patient Protection and Affordable Care Act (PPACA) have added additional requirements and changed reporting deadlines. REQUIREMENTS UNDER ERISA & PPACA If you offer any of the above-mentioned health and welfare benefits, you must meet specific requirements, specifications, and deadlines for plan documents under ERISA as well as under PPACA. The key ERISA and PPACA provisions are listed here and details of each follow: · distribute a written plan document and Summary Plan Description (SPD) for every health and welfare benefit and any voluntary benefit pre-taxed under a 125 plan to all plan participants including spouses and COBRA enrollees, · distribute ERISA benefit notices to all eligible employees on enrollment and re-enrollment of your health plan, · notify participants of any change to a plan that materially affects the design or pricing, · file Form 5500 and all applicable schedules within 7 months after the plan year ends for each plan that has more than 100 participants (not just employees) on the first day of the plan year, · meet all fiduciary standards and plan terms, · establish a trust fund that holds the plan’s assets, if applicable, · establish a recordkeeping system to track contributions, benefit payments, maintain participant and beneficiary information, and to prepare reporting documents, · provide a summary of benefits and a coverage explanation (SBC) and documentation of how and when it was distributed each year, · verify fiduciary bonding needs for individuals handling funds and other property of employee benefit plans like a 401(k) plan, if applicable. The deadline for each requirement varies, depending on when your plan was enacted, whether it is grandfathered under PPACA, whether material changes have been made, and other exceptions. Copies of certain plan documents must be also available to participants and beneficiaries on written request. SPD and Wrap Requirements An employer must have a written Summary Plan Description (SPD) for each separate welfare benefit plan, informing participants of eligibility requirements, benefits, claims and appeals procedures, and rights under ERISA. Your insurers may provide some but not all information required for SPD compliance. It is a common mistake by employers to think the summary insurance information they receive from their insurance provider meets the SPD requirements. A common approach is to combine all SPDs into one overall SPD Wrap notice, tying in the required ERISA language and simplifying the SPD notice process. A customized SPD Wrap must include the name of the plan, plan sponsor, plan administrator, plan year, employer tax identification number, type of welfare plan, type of administration, summary of the benefits, detailed description of plan benefits for group health plans, provider network availability for group health plans, procedures for Qualified Medical Child Support Orders (QMCCOS), COBRA rights, plan contributions, and claims procedures. A Statement of ERISA Rights is also required. The SPD and Wrap must be distributed to newly-enrolled participants within 90 days of when coverage started, or within 120 days of a new plan being established. ERISA Benefit Notices All eligible employees must receive ERISA Benefit Notices upon enrollment and re-enrollment of your health plan. Depending on company size and other criteria, you may be required to provide employees with the following employee notifications: · Medicare Part D Notice · CHIP (if applicable in your state) · Wellness Program Disclosure · Women’s Health & Cancer Rights · Hospital Stay Rights for Childbirth · Mental Health & Parity Act · HIPAA Notice · Disclosure of Grandfathered Status · COBRA Rights – Initial Notice In the event of certain Qualifying Events, additional required notices may include: · COBRA Qualifying Event Letter · HIPAA Breach Notice · Medical Child Support Order Notice (MCSO) · National Medical Support Notice (NMS) Form 5500 and Summary Annual Report ERISA further requires employers with 100 or more participants to annually report certain information to the DOL on Form 5500. Form 5500 returns ask for information about the plan, including plan name, plan year, plan sponsor, plan number, participants, insurance costs, and financial data. Employers who set up an SPD Wrap can file one 5500 report for the SPD Wrap covering all health and welfare plans. Once a Form 5500 is completed and filed, you must prepare a Summary Annual Report (SAR) for each of your welfare benefit plans subject to ERISA reporting, or just one if done under an SPD Wrap. The SAR summarizes Form 5500 information and notifies participants Form 5500 has been filed and a copy is available to those who request a copy. SARs must be distributed to covered participants within nine months after the end of the plan year. A SAR is not required for plans that are not required to file a Form 5500. AUDITS AND ENFORCEMENTS The Department of Labor’s Employee Benefits Services Administration (EBSA) routinely conducts audits of group health benefit plans to investigate or audit the plan’s compliance. In addition, the Health Benefits Security Project (HBSP) was recently established under PPACA to add to EBSA’s compliance and enforcement initiatives. It has been reported that smaller groups of fewer than 100 are being particularly targeted since the DOL does not have the ability to monitor them through a Form 5500 filing. Audits are anticipated to increase significantly, given increased audit budgets and concerns over ERISA and PPACA violations. If your company is selected for a DOL audit, a letter will be sent to the Plan Sponsor containing the list of documents the DOL would like to review. The request for information typically goes back three to six years. AUDIT TRIGGERS AND PENALTIES Every audit is unique. However, reported trends show the following are typical areas of concern, in recent audits: · Summary Plan Descriptions · HIPAA compliance, particularly notices to employees about special enrollment rights · PPACA Grandfathered Plan notices and documentation of coverage for adult children · PPACA lifetime and annual limit requirements · inadvertently excluding people who may be eligible to participate in the plan, including dependents up to age 26 The DOL reports common audit triggers include: · the Department’s internal audit initiatives · employee complaints · press tips and public visibility of a company or its third-party vendors · the Department’s Memorandum of Understanding with the IRS · form 5500 filings inconsistencies or suspect information · an audit of a plan’s auditor (if 100+ group) · randomly selected In the future, DOL audits will also likely focus on: · employer communications and documentation · employer reporting requirements · coverage of essential health benefits, cost-sharing and out-of pocket limits for applicable plans · annual limits, on non-essential health benefits only · structure of group health benefit plans and offers of coverage · waiting period limitation of 90 days · exchange notice documents · adherence to PPACA requirements The employer is solely responsible for ERISA compliance. Penalties may be enforced for failure to comply with ERISA regulations, including DOL enforcement actions and penalties as well as employee lawsuits. Certain infractions can entail up to $100/day penalty for every employee that is affected by a violation until the violation is corrected. The penalty for late delivery of SPD or Wrap can be as much as $110/day per plan. Late filing of form 5500 can result in fines as high as $1,100 per day. The DOL estimate three out of four plans they audit have an ERISA violation, and about 70 percent of audits with violation have resulted in monetary fines to the employer. AUDIT PREPARATION Knowledge and familiarity of compliance requirements, complete documentation, and policies that show good faith efforts to comply are the best way to be prepared for an audit (as well as to avoid one in the first place). Below is a summary of the items you should have in place to ensure ERISA compliance. 1. ERISA & PPACA requirements mentioned above 2. Written ERISA plan document 3. SPDs or the combined SPD Wrap prepared and distributed to all plan participants within 90 days of first day of coverage 4. Summary of Material Modification (SMM) for any amendments such as carrier change, eligibility change, benefit structure change, etc. to your plans 5. Form 5500 and SAR filed annually (only if you have over 100 enrolled participants in any benefit) An organized employer with meticulous records who has a health insurance broker who helps review all of the company’s

All employers covered by the Health Care Security Ordinance (HCSO) are required to submit the 2016 Annual Reporting Form by May 1, 2017. Covered employers who fail to submit the Annual Reporting Form will be subject to a $500 penalty for each quarter that the violation occurred. An employer is covered by the HCSO for any calendar quarter if it meets the following three conditions:

Employs one or more workers within the geographic boundaries of the City and County of San Francisco;

Is a for-profit business with 20 or more persons performing work OR a nonprofit organization with 50 or more persons performing work. This includes all persons working for the entity, regardless of whether they are located in San Francisco or outside the city.

Resources for completing the 2016 Annual Reporting Form (due by May 1, 2017) or to learn more about HCSO, are provided below:

If you would like to notify your clients of the impending deadline, simply copy the details within this email to create your own message. If you have any questions about HCSO compliance or reporting for 2016, please contact the Office of Labor Standards Enforcement (OLSE) at hcso@sfgov.org or 415.554.7892.

Family Medical Leave Act entitles eligible employees of covered employers to take unpaid, job-protected leave for specific family and medical reasons if the employee has been with the company for one year, has worked at least 1250 hours during the prior 12 months and works in an area where there are at least 50 employees within 75 miles. For additional details, visit the Department of Labor FMLA page. Notify the organization when you have a qualifying leave such as birth or adoption of a child, a serious health condition, to care for a spouse, child or parent with a serious medical condition or for reservist or national guard provisions related to you or an immediate family member leaving for military duty or being injured in active duty.
Additional information and notices can be found at: http://www.dol.gov/whd/fmla/index.htm

10 REASONS TO BUY CYBER LIABILITY INSURANCE
1. Complying with breach notification laws costs time and money
2. Third party data is valuable and you can be held liable if you lose it
3. Data is one of your most important assets yet it is not covered by standard property insurance policies
4. Systems are critical to operating your day to day business but their downtime is not covered by standard business interruption insurance
5. Cyber-crime is the fastest growing crime in the world, but most attacks are not covered by standard property or crime insurance policies
6. Retailers face severe penalties if they lose credit card data
7. Your reputation is your number one asset, so why not insure it?
8. Social media usage is at an all-time high and claims are on the rise
9. Portable devices increases the risk of a loss or theft
10. It’s not just big businesses being targeted by hackers, but lots of small ones too

WHAT IS CREDITA BLE COVERAGE?
Beginning January 1, 2006, Medicare beneficiaries will have the opportunity to receive subsidized prescription drug coverage through the new Medicare Part D program. Beneficiaries who choose not to sign up at the first opportunity may have to pay more if they wait to enter the program later after the open enrollment period.
Beneficiaries who have other sources of drug coverage – through a current or former employer or union, for example – may stay in that plan and choose not to enroll in the Medicare drug plan. If their other coverage is at least as good as the new Medicare drug benefit (a
nd therefore considered “creditable coverage” ), then the beneficiary can continue to get the high quality care they have now as well as avoid higher payments if they sign up later for the Medicare drug benefit. Under §423.56(a) of the final regulation, coverage is creditable if the actuarial value of the coverage equals or exceeds the actuarial value of standard prescription drug coverage under Medicare Part D, as demonstrated through the use of generally accepted actuarial principles and in accordance with CMS actuarial guidelines. In general, the actuarial equivalence test measures whether the expected amount of
paid claims under the entity’s prescription drug coverage is at least as much as the expected amount of paid claims under the standard Part D benefit.
REQUIRED DISCLOSURES TO CMS Section 423.56(e) of the final regulation requires all entities described in § 423.56(b) to disclose to CMS
whether their prescription drug coverage is creditable or non-creditable. The disclosure must be made to CMS on an annual basis, or upon any change that affects whether the coverage is creditable. Rules for making disclosures to CMS will be provided in future guidance.
REQUIRED DISCLOSURES TO MEDICARE BENEFICIARIES
In general, entities listed in section 423.56(b) of the final regulation must provide, or arrange for providing, a notice of creditable prescription drug coverage to Medicare beneficiaries who are covered by, or who apply for, prescription drug coverage under the entity’s plan

CMS Online Disclosure
• If employer offers prescription drug benefits to any Medicare Part D eligible individual on the beginning date of their plan year, they are to complete the disclosure to CMS form for that plan year. This disclosure of creditable coverage status must be provided within 60 days after the beginning date of the plan year and must be made to CMS on an annual basis and upon any change that affects whether the drug plan is creditable. Provide online disclosure to CMS of creditable coverage status of your prescription drug plan at the following link: https://www.cms.gov/CreditableCoverage/45_CCDisclosureForm.asp

ERISA Summary Plan Descriptions (SPD) or SPD Wraps
• Employers are to provide employees with a SPD communicating plan rights and obligations to participants and beneficiaries within 90 days after becoming covered under the employer’s plan. Plan administrators of a new plan must distribute an SPD within 120 days after the plan is established. An updated SPD must be furnished to all covered participants every 5 years, and every 10 years for plans with no changes. Summary of Material Modifications (SMM) must be furnished automatically to participants when a plan is amended or “materially” modified.

Summary of Benefits & Coverage (SBC)
• Insurers and group health plans must provide a summary of benefits and coverage (SBC) document to each full time employee, and to family members of those enrolled in coverage in a standardized, consumer-friendly format, making it easier for participants to compare with other plans. The health insurance carrier prepares this for fully insured plans, and employers are responsible to prepare the SBC for self-funded policies.

5500 Report Due
Groups with 100+ employees are to submit a 5500 report to the IRS for all health and welfare plans. For plan years commencing on or after January 1, 2009, employers must file electronically using the EFAST2 processing system. These employee benefit plan forms are due by the last day of the seventh month after the plan year ends.

Employee Notifications
Using your HR Service, Inc. Compliance Basic service, an employee notifications report is emailed to you for distribution to your employee’s when you complete or update your Company Profile. The notification report meets the below health & welfare ERISA notification requirements.

Am I an Applicable Large Employer (ALE)? What’s a look back period? What’s my measurement period? What’s my stability period? What’s an administrative period? Am I part of a controlled group? Which employees must be included in calculations? Do I have to report on sections 6055 and 6056 employer reporting?

There are so many different calculations governing the Affordable Care Act. If you get one of them wrong, you are in violation of the act and subject to fines and penalties. In this article, we are going to provide clear explanations to help you comply.

Applicable Large Employer (ALE)
The Affordable Act and its enforcers, the Internal Revenue Service (IRS), Department of Labor (DOL) and Health and Human Services Department, require all organizations who are an “ALE” to offer medical insurance to their employees that meets minimum essential value requirements at affordable rates. They further require ALEs to submit reports 1095-C/1094-C reporting on sections 6055 and 6065.

An organization is considered an applicable large employer if they average 50 or more full-time or full-time equivalent (FTE) employees during the prior year. The employer looks back over an entire 12 month period of time, adding all full-time employees who averaged 30 hours or more work per week, along with all work hours performed by part-time, temporary and seasonal employees. Work hours include time paid (including sick, jury, disability, severance, leaves of absence, vacation and holidays).

ALE Calculation
1) Determine the number of full-time employees for each month (anyone averaging 30+ hours per week or 130 hours per month).
2) Total the full-time equivalent (FTE) service hours for all variable hour employees (part-time, temporary and seasonal employees) and divide this by 120.
3) Add the FT employee to the FTE for each month and divide by 12 to find the average.

If you have 50 or more, you are an ALE. (See below example.) Note: if your business has a seasonal hiring pattern (i.e. summer or holiday hires), you may be able to exclude those employees if the period of hire is less than 120 days in a calendar year. See http://www.irs.gov/Affordable-Care-Act/Employers/Determining-if-an-Employer-is-an-Applicable-Large-Employer, seasonal workers.

Controlled Groups
If you are part of a controlled group, you must include total FT and FTE for all applicable controlled groups together to determine ALE status for all group members. There are three applicable control groups as defined by the IRS Code § 414 (b) and 414 (c).

A Parent-Subsidy Group is when one or more businesses are connected through stock with a common parent corporation and (a) 80% of the stock of each corporation (excluding the common parent corporation) is owned by one or more corporations in the group and (b) the Parent Corporation owns 80% of at least one other corporation.

A Brother-Sister Group is a group of two or more corporations, where five or less common owners (common owners included individuals, a trust, or an estate) own a controlling interest (direct or indirect) of each group and have effective control.

A Combined Group is a group consisting of three or more organizations where (a) each organization is a member of either a parent-subsidiary or brother – sister group and (b) at least one corporation is the common parent of a parent-subsidiary and is also a member of a brother-sister group.
(See: http://www.irs.gov/pub/irs-tege/epchd704.pdf.)

If you are attempting to classify employees as independent contractors in attempts to fall below the 50 ALE number, be careful. The IRS and DOL are cracking down on any misclassifications. Read the new DOL guidance memo on this topic at http://www.dol.gov/whd/workers/Misclassification/AI-2015_1.htm.

Measurement, Stability, and Admin Periods
Measurement periods are the defined period of time where an employer calculates average work hours for variable hour employees to determine if they are eligible to participate in their medical insurance plan or not. Any variable employee who averages 30 hours or more during the measurement period is eligible. Measurement periods can be between three and 12 months in length. You can also define different measurement periods for new hires and for regular employees. Make sure to define your selected measurement periods, stability periods and administrative periods in writing, and consistently follow and administer benefit eligibility accordingly.

A stability period is the time period that an eligible employee can remain on medical coverage regardless of their current average work hours. The stability period must be equivalent to the same time period as the measurement period, but not less than 6 months.

Employers are allowed an administrative period of up to 90 days to perform initial measurement period calculation of eligibility for coverage and enrollment into plans. However, the measurement period and stability period combined cannot be more than 13 months for new employees. As soon as one Measurement Period ends, the next one begins with the Administrative Period overlapping the end of the prior Stability Period and the beginning of the next Measurement Period.

Calculating the Play or Pay Penalty
For businesses with fewer than 50 FTE, there is no play or pay penalty. Penalties are based on two areas of compliance: minimum essential coverage (plan pays on average at least 60% of the total allowed benefits and participants don’t pay more than 40%) and affordable coverage (not more than 9.5% of employee’s monthly wage for self only coverage). Businesses with 50 or more employees that do not offer minimum essential coverage will be assessed a $2,000 per employee (minus the 30 employee allowance allowed for this category only) per year tax penalty if even one employee enrolls in a health insurance exchange plan and qualifies for a premium subsidy or federal tax credit. This penalty goes to $3,000 per employee if the coverage offered is not affordable.

Sections 6055 and 6056 employer reporting
If you are an ALE with 50 or more FT or FTE employees, you are required to complete forms 1095-C/1094-C to report who is offered minimum essential coverage at affordable rates. This allows the IRS to determine if you or employees are to be fined. All self-funded plans must report as well, either on forms 1095-B (if less than 50 employees) or 1095-C.

Make sure you use the right calculations when determining which parts of the Affordable Care Act apply to you and in setting up eligibility. There are many facts to consider in adhering to these laws and ensuring compliance.

Premium Assistance Under Medicaid and the Children’s Health Insurance Program (CHIP)

If you or your children are eligible for Medicaid or CHIP and you are eligible for health coverage from your employer, your State may have a premium assistance program that can help pay for coverage. These States use funds from their Medicaid or CHIP programs to help people who are eligible for these programs, but also have access to health insurance through their employer. If you or your children are not eligible for Medicaid or CHIP, you will not be eligible for these premium assistance programs.

If you or your dependents are already enrolled in Medicaid or CHIP and you live in a State listed below, you can contact your State Medicaid or CHIP office to find out if premium assistance is available.

If you or your dependents are NOT currently enrolled in Medicaid or CHIP, and you think you or any of your dependents might be eligible for either of these programs, you can contact your State Medicaid or CHIP office or dial 1-877-KIDS NOW or www.insurekidsnow.gov to find out how to apply. If you qualify, you can ask the State if it has a program that might help you pay the premiums for an employer-sponsored plan.

Once it is determined that you or your dependents are eligible for premium assistance under Medicaid or CHIP, as well as eligible under your employer plan, your employer must permit you to enroll in your employer plan if you are not already enrolled. This is called a “special enrollment” opportunity, and you must request coverage within 60 days of being determined eligible for premium assistance. If you have questions about enrolling in your employer plan, you can contact the Department of Labor electronically at www.askebsa.dol.gov or by calling toll-free 1-866-444-EBSA (3272).
If you live in one of the following States, you may be eligible for assistance paying your employer health plan premiums. The following list of States is current as of July 31, 2013. You should contact your State for further information on eligibility –

Preventative vs. Diagnostic Services in the Affordable Care Act
Finance, Healthcare Reform, Medical Billing & Collections, Payers
By Matt Dallmann
Under the Affordable Care Act, insurance plans now cover preventative care without patient cost sharing, i.e., without co-pays, co-insurance, or deductibles. However, services that are not classified as preventative care are still subject to cost sharing. It is important for physicians and their staff to be able to differentiate between the two in order to avoid blindsiding patients and avoid experiencing a revenue loss. Since the average deductible on plans offered through the state and federal health insurance exchanges is between $1,000 and $6,000, financial responsibility for a non-preventative visit could easily fall on the patient.
To clarify, here are a few examples of preventative care and diagnostic care.
Preventative services:
• If an abnormal finding on a preventative mammography screening is later found to be normal, then the future mammography screening is considered preventative.
• If a polyp is removed during a preventative colonoscopy screening, the removal of the polyp, and any associated lab and facility fees, performed during the same encounter, are considered preventative.

Diagnostic services:
• If an abnormal finding on a preventative mammography screening is later confirmed to be abnormal, then the future mammography screening is considered diagnostic, and any deductible, co-pay, or co-insurance is applied.
• If a polyp is removed during a preventative colonoscopy, any future colonoscopies are considered diagnostic, because the time intervals between future scopes are shorter. The first step for avoiding confusion between preventative and diagnostic care lies in the hands of the medical coder and biller. Preventative services must be coded with the appropriate CPT codes, diagnosis codes, and modifiers. Diagnostic services or problem related E&M codes can be reported on the same encounter, with the appropriate modifier and diagnosis, and, depending on the payer’s policies, be paid at 50 percent of the contracted rate. If coders know the difference between the two, and can code correctly with supporting documents as a backup, they can effectively maximize physician reimbursement. However, even if coders report services optimally, physicians will encounter problems. If you are aware of these potential problems, you will be better equipped to handle them.
Here are some examples of problems and outcomes:
1. If you bill for the preventative and diagnostic codes with appropriate modifiers, etc., and bill the patient for any deductible applied on the problem-oriented E&M code, the patient will likely call to complain, stating there should be no out of pocket because the reason for the visit was preventative. Since most patients currently have little to no comprehension of the intricacies and protocols of correct medical coding, it will be difficult to explain why the visit was billed the way it was, and the patient will most likely refuse to pay and take his business elsewhere.
2. If you spend extra time and effort evaluating and treating a patient for all her complaints and concerns during a preventative visit, and only bill for the preventative portion of the visit, then you are saddled with the entire burden of all the newly insured, without the appropriate compensation.
3. If you bill for both the preventative and diagnostic portion of the visit, and simply waive any deductible, you may open yourself up to frequent billing audits.
None of these scenarios is ideal, so it is important to determine which is best for you. In any case, it’s a good idea to present a brief, bullet pointed disclaimer to your patients making them aware of the different types of care and what their potential out of pocket costs might be — perhaps even a simple check box with the statement, “I do (or do not) want to receive diagnostic services not covered under my preventative benefits.” This way there are no surprises, and you may help enhance your professional brand as a trustworthy doctor.